The group announced the investment in six new web offset presses from Goss International on 2 April, after a year-long project investigating the latest web offset technology.
Polestar’s deal encompasses two 96pp Sunday 5000 presses, two short-grain 64pp Sunday 4000s, and two 16pp M600 cover presses with phased installation slated for 2014 and 2015.
The 96pp presses will be the first to be installed, with both set to be up and running in the first half of next year.
Chief executive Barry Hibbert said long-term commitments from key customers had made the spend possible. "The best time to invest is in a recession," he stated.
"We told our customers we would make a significant investment in web just as we did with gravure, and we’ve been following the technology to make sure we have the best-in-class."
Goss International chief executive Rick Nichols said the company was delighted with the deal. "Our global product portfolio and unique financial service capabilities have paved the way for this. This agreement emphasises Goss’ position as the premier provider in our industry and recognises our ability to meet the changing needs of customers."
John Chambers, Goss International sales director for the UK, Ireland and Africa, described it as "the deal of a lifetime".
"It's probably the biggest deal I've worked on in the whole of my career. It was a tremendous effort on all sides and obviously I'm absolutely delighted with it. This is a defining moment for the market," he said.
Hibbert said Polestar’s owner, Sun European Partners, was supportive of the plans, and that the funding involved a significant deposit from Polestar’s own cashflow, together with a "straightforward" lease purchase agreement.
He said anticipated decline in magazine printing volumes was "a difficult one to call" but expressed his confidence in the medium: "Quality magazines and supplements are here to stay. Advertisers are starting to realise that print has a very, very relevant place."
The plans will not involve a new web offset ‘supersite’ next to Polestar’s Sheffield gravure facility, which had been mooted as a possibility. "We looked at it as an option, but we couldn’t make the numbers work in terms of payback," Hibbert explained.
Instead, Polestar will spend the next three months evaluating a number of options around the best way to install the presses at its existing plants, and this includes the possibility of Sheffield becoming a hybrid gravure and web facility.
"The two 96s could go in Sheffield, which would have benefits for some of our key clients. It would be interesting to see how 3.8m gravure works alongside 2.8m offset, and what the outputs are like," Hibbert mused.
The 96pp presses will share three pinless folders to provide maximum flexibility for producing 32pp or 48pp sections.
Hibbert said print finishing requirements would also play an important part in the location decisions. "This is not just about presses, it's about finishing and the hand finishing we do for a lot of our clients too."
The decision to opt for twin short-grain presses with Tolerans inline stitching is also significant, after last month’s closure of Polestar Chromoworks in Nottingham which housed Polestar’s only short-grain press. "Short-grain works well for us. The short-grain at Chromoworks was always the most productive and full press," Hibbert said.
Obsolete capacity will definitely be taken out. "We’ll be closing down older capacity that is past its sell-by date. We are not looking at a significant increase in capacity, that would be crazy. We are looking at newer, better capacity," Hibbert stated.
INDUSTRY REACTION
Jasper Scott Manufacturing director, IPC Media
"It’s fantastic news, especially for us as one of Polestar’s largest customers. I’ve felt that they needed to reinvest in web offset for some time, so this is very encouraging."
Mal Skelton Production director, Immediate Media
"This is good news for the industry, and I am pleased that Polestar is leading the way with this investment, demonstrating its continued long-term commitment to the physical printed media."
Mark Scanlon Chairman, Walstead Investments (owner of Wyndeham Group)
"Polestar operates many old presses that have been in need of modernisation for some time. So, if this investment is based on a like-for-like volume replacement plan then it’s a decision we would have made too. However, if this equipment is aimed at increasing capacity and consequently means Polestar has to take more market share to justify its investment, then we believe this will not be in the long-term interest of publishers and print buyers."
Alex Evans Managing director, Precision Colour Printing
"It’s positive PR for Polestar. Let’s see what materialises."
Simon Biltcliffe, Managing director, Webmart
"It's great to see investment of this scale coming into the industry again. It will be interesting to see the investment reaction to this, and hopefully the added-value features this will bring customers rather than just cost savings in manufacture."
